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Twilio S-1

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Re: Twilio S-1

#201

Post by bkruse »

ziszis wrote: post #196
bkruse wrote: post #194

Earlier quoted context omitted.

The cost of revenue is interesting. I want to shine some light from an insider perspective to the industry. I operate a telecom company that mimics the twilio API and we are nabbing their bigger customers left and right. Being fully transparent - our average cost per minute of long-distance is $0.00014 (with 6 second increments) and twilio charges $0.0015/minute (with _60_ second increments). Wholesale long-distance…

Twilio has been very effective at the low volume end of the market with individual developers where simplicity and time to market is more important than price. But that equation changes as a company grows. The question remains whether they can also play effectively at the high volume end of the mArket. I have heard of several other companies that mimic the Twilio API, but with much more competitive pricing. AWS is su…

That's a great comparison between AWS and Twilio.

I think Twilio is going to try to get there - and they have made some progress that's made it difficult to mimic on the backend.

I would hope that their cost structure is flexible enough to allow them to be competitive in the high volume space. That may not be nearly as much margin, but at one point in time, only 2 years ago, 2 customers made up 35% of their revenue (from what I had heard).

Take any developer that knows nothing about telecom and start dialing in seconds. That's extremely addicting - but it is quickly replaced as those bills rack up with pretty small volume pricing discounts.

Switching from twilio to us? Easy. Change the URL.

Switching from AWS - with the insane amount of APIs and toolkits that entrench you into it's structure to someone like rackspace or google? Much more difficult.

Re: Twilio S-1

#202

Post by caseysoftware »

loopdoend wrote: post #195
ben_jones wrote: post #165

Earlier quoted context omitted.

A list of their competitors: https://www.quora.com/Who-are-Twilios-competitors . As a Twilio customer that spends maybe ~$500 /mo i'll look at any alternative that allows me to send meta data or allows some process to have a foreign key allowing me to persist conversations in a sane manner (and I'm currently researching just that). Twilio also does not have their own network, so competitors like Bandwidth that have t…

Twilio is a Bandwidth customer.

Bandwidth launched a competitive product over two years ago: https://catapult.inetwork.com/pages/home.jsf

The fact that no one here has mentioned it is telling.

Re: Twilio S-1

#204

Post by ben_jones »

loopdoend wrote: post #195
ben_jones wrote: post #165

Earlier quoted context omitted.

A list of their competitors: https://www.quora.com/Who-are-Twilios-competitors . As a Twilio customer that spends maybe ~$500 /mo i'll look at any alternative that allows me to send meta data or allows some process to have a foreign key allowing me to persist conversations in a sane manner (and I'm currently researching just that). Twilio also does not have their own network, so competitors like Bandwidth that have t…

Twilio is a Bandwidth customer.

Also many of the SMS and MMS companies sign contracts for X messages per month with the telecom companies. If they have a slow month where they can't fulfill the obligations of the contract they'll resell their remaining capacity to another company in the space.

Re: Twilio S-1

#207

Post by smileysteve »

Animats wrote: post #75

There's a lot there not to like: Revenue: $166,919,000 Net Loss: $38,896,000 So they're still not profitable. This is surprising, since they don't have any big capital investments. They're not doing anything that takes a lot of R&D. The thing runs on Amazon AWS. They've been operating for years and should be profitable by now. Yes, they're growing fast, but the costs don't rise in advance of the growth. You don't hav…

> So they're still not profitable

Why would a company want to raise money (IPO) if they had a high net profit margin? If they're profitable and happy about it, the insiders could just dividend out the money.

Re: Twilio S-1

#208

Post by nopzor »

runako wrote: post #104
toomuchtodo wrote: post #98

Earlier quoted context omitted.

Want to make a long bet? I bet you Twilio doesn't turn into that gorilla. AWS is a far cry different than Twilio.

1) AWS != Amazon. Amazon went public 10+ years before AWS launched. AWS is a tiny part of Amazon's revenue today. You moved the goal posts! We were discussing a money-losing Internet retail pure-play; you're comparing to a heavily-subsidized (via start-up capital etc.) tech services pure-play. 2) Which is another key point: the prospects of the company at IPO are very different from the company today. A bet on AMZN t…

He definitely moved the goal posts, but remember that AWS is most of Amazon Incs _profit_ today.

Also, AWS is a small-ish part of Amazons _revenue_ but given the relative growth rates that is less and less true every year.

The reason why AMZN stock is so high currently has a lot to do with AWS.

Re: Twilio S-1

#209

Post by jsjohnst »

joering2 wrote: post #198
Animats wrote: post #75

There's a lot there not to like: Revenue: $166,919,000 Net Loss: $38,896,000 So they're still not profitable. This is surprising, since they don't have any big capital investments. They're not doing anything that takes a lot of R&D. The thing runs on Amazon AWS. They've been operating for years and should be profitable by now. Yes, they're growing fast, but the costs don't rise in advance of the growth. You don't hav…

Their large clientele is all sorts of spamming services. I receive tons of messages daily (currently ATT but Sprint before) for different type of products and services, mostly work by completing surveys. Everytime I trace number down - its Twilio. And their spam complaint team never answer to my complains, so unfortunately as long as spammers can use their services, they will be making money. On the good side, I use…

It's not impossible. It's quite easy in fact to determine if a number is a real cell phone or not by doing an NPAC lookup to see if LNP is applicable (if so, you just check the service provider type, if not, a simple check of the NANPA allocation would do). Lots of companies provide it as a service. Just most places don't check and blindly try to deliver to whatever number you provided.

Re: Twilio S-1

#210

Post by prostoalex »

tryitnow wrote: post #147
Animats wrote: post #75

There's a lot there not to like: Revenue: $166,919,000 Net Loss: $38,896,000 So they're still not profitable. This is surprising, since they don't have any big capital investments. They're not doing anything that takes a lot of R&D. The thing runs on Amazon AWS. They've been operating for years and should be profitable by now. Yes, they're growing fast, but the costs don't rise in advance of the growth. You don't hav…

Just want to note that yes, cost can rise in advance of growth. Whether or not that's "OK" depends on the unit economics. Frankly, I share your skepticism. I think you hit the nail on the head - Twilio has few, if any moats, that can't be crossed by large competitors like Google or Amazon. And if I'm Bezos and Twilio is making all this money off the back of AWS, why not just cut out Twilio? Heck, Amazon is doing that…

> Twilio has few, if any moats, that can't be crossed by large competitors like Google or Amazon

Here's one moat - with GOOG's annual revenue of $75 billion or AMZN's $107 billion how likely are either to chase an opportunity that, assuming perfect execution, complete market share grab and ultimate destruction of Twilio, will add $167 million of annual revenue to their balance sheet?

From the corporate politics standpoint this would be a hard project to pursue internally, as anything under a billion is unlikely to register on CEO's radar.

From the customer standpoint, chances of getting competent and prioritized support might be better with Twilio, where the telephony API is their primary product, versus Google, where it might be 108th project on the priority list.

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